Local and organic farmers seem to be having a tough time capitalizing on the demand for their produce. From the unnecessary services of middlemen to not being able to get word out about their goods, these farms needed help. Enter FarmersWeb, a site that’s connecting regional farms with wholesale buyers. CEO and co-founder Jennifer Goggin explains why she and her partner, David Ross, launched the service and what sets them apart from their competition.
Tell us about your product/ service. Why did you launch this particular product?
At its core, FarmersWeb offers a way for wholesale buyers and local farms to transact with each other. Of course, the site does much more for the users, both before and after the actual transaction. FarmersWeb allows farmers to manage their real-time inventory, set their delivery options and requirements, and confirm or modify orders as they come in. Farms either deliver to the buyers themselves or through a third-party driver that we can help arrange. Buyers use FarmersWeb as a way to explore and discover farms in their area, or to search for particular items, and they can then place an order online for delivery from multiple farms in one easy transaction. FarmersWeb streamlines the paperwork and payment process for both sides.
We launched the company after working in the wholesale food industry for a number of years, during which we noticed a connection gap between the buyers and sellers. Farms were keen to tap the large metro market near them, and chefs were eager to source from local farms, but there was no easy way for the two sides to meet and manage their relationship without going through a distributor. Many farms already had their own trucks heading into the city, both for markets and deliveries, and didn’t actually need the logistics and storage services that a distributor who charges upwards of 30% to provide. What these farms really needed was a way to access the marketplace themselves to increase their sales, and our online platform fills that need while making the process more efficient for both sellers and buyers.
How is it different from other services in the market?
Unlike a traditional distributor, FarmersWeb does not hold inventory; we’re simply the conduit for direct orders between a buyer and a farm. This means that everything purchased through our site is picked and packed for each buyer and is much fresher than items coming from a warehouse. We are also able to ensure 100% transparency for the buyer about where their products are coming from and how the products were grown or raised. Finally, by selling directly through FarmersWeb rather than through a distributor, the producer keeps much more of every dollar spent on food than they would selling through the traditional food system.
There are no other online services for wholesale buyers in our region that have the breadth of products that our farms offer. Most of the other online food companies are focused on the individual consumer market, such as managing CSA subscriptions, or are simply providing a database of farms located near the user.
What market are you attacking and how big is it?
The wholesale food market in New York City alone is huge – nearly $30 billion, according to recent surveys. Within that, it is estimated that the demand for local foods represents about $1 billion. We work with a variety of buyers who are eager to source local products, and those buyers range from restaurants and caterers to hotels, corporate kitchens, retail stores and more. There are more than enough farms to meet the demand; it’s just a matter of making the connection.
What is the business model?
FarmersWeb is free for both buyers and farms to sign up and create accounts. After the first free order for each farm, we take a small commission (5%) from the farm on sales that go through the site.
What are the milestones you plan to achieve in the next 6 months?
We’re looking to continue to expand in New York City and the tri-state area, and we’ll soon be considering in which metro area we launch the next online marketplace.
What has the response been like? Did it meet your expectations?
In the past year or so, we grew from just 20 products represented on the marketplace to now being able to offer buyers almost anything that can be grown, raised or produced locally. Our sales have been averaging a 25% month-over-month growth since last summer, which shows just how eager wholesale buyers are to efficiently source local ingredients. On the farm side, we’ve had so many sign ups that we had to institute a waitlist, and we’ve been humbled to hear from our current farms that FarmersWeb has been invaluable in managing and expanding their wholesale business. We look forward to continuing to grow the local food system both in New York and beyond!
Image credit: Noah Fecks